Unemployment Rate Down, But Overall Jobs Picture Still Not Great
Ball St. economist says true job growth not happening; dismisses conspiracy that Obama is "cooking the books"
The nation's unemployment rate dropped unexpected last month, but an economist says the overall jobs picture is still not improving.
The Department of Labor says the jobless rate in September was 7.8 percent, down from the August rate of 8.1 percent. The department says 114,000 jobs were created last month, and that 418,000 people joined the labor force, meaning more were looking for work. However, the labor force participation rate of 63.6 percent was up only a tenth of a percentage point and remains at an historically low level.
Ball State economist Mike Hicks says the jobs report is nothing to cheer despite the unemployment rate being below eight-percent for the first time in 43 months. Hicks says even with an upward revision in the number of jobs created in July and August, the economy would need to generate at least 150,000 jobs a month to make a significant dent in the jobless rate. Despite last month's increase in the labor force, Hicks says that number is still vastly below what it was when employment peaked five years ago - if the same number of people were in the labor force today, Hicks says the jobless rate would be closer to eleven-percent.
The government's measurement of those who are unemployed and under-employed - those with part-time work who would rather be working full-time - remained unchanged in September at 14.7 percent. Hicks says that figure may be a better indicator of the state of the economy, as it has remained well above ten-percent since June, 2008.
Hicks, however, dismisses the conspiracy theory among some, most notably former General Electric CEO Jack Welch, that the Obama administration was manipulating the numbers to help the president's re-election campaign. Welch made the claim during an appearance on CNBC just after the employment numbers were released. Hicks says the economists at the federal Bureau of Labor Statistics are career government employees of all political persuasions, and says if Obama were going to change the numbers, Hicks believes he would come up with better overall statistics than were in this report.